TV semiconductor market slump

Due to the overall sluggish electronics industry in 2011, heavy price pressures and sluggish TV sales, the sales of semiconductors used on TV motherboards shrank last year and forced some well-known suppliers to withdraw from the industry forever. In 2011, sales of SoC chips were 2.19 billion U.S. dollars, which was 7.4% lower than the 2.36 billion U.S. dollars in 2010. In addition to this year shortly before the economic downturn, the SoC market has been growing, with a sharp increase of 22% in 2010 compared to 2009, and then began to decline last year.

SoCs on TV motherboards typically integrate analog and digital video decoders, demodulators, central processing units, and image processing functions into a single application-specific integrated circuit.

Like TV SoCs, sales of other TV semiconductors have also declined. For example, driver IC sales in 2011 dropped from 2.68 billion US dollars in 2010 to 2.61 billion US dollars. As the LCD TV market quickly adopts LED backlighting, LED backlighting is a bright spot in the TV semiconductor market. LED backlight sales increased from 2.87 billion to 4.1 billion US dollars, helping the overall TV semiconductor market in 2011 to grow from 14.7 billion US dollars in 2010 to 15.84 billion US dollars.

Indeed, television semiconductors are facing the problems of the recent weak sales of high-end televisions and the commercialization of small LCD TVs. Last year, the average selling price of SoC devices dropped from $9.85 in 2010 to $8.40.

Other factors are also detrimental to the industry, such as the near-saturation of the fast-growing flat-panel TV market in Western Europe and North America, the uncertainties in the global economy, and the rapid withdrawal of CRT analog TVs - eliminating a powerful impetus for flat-panel TV growth. .

Smart TVs will save TV semiconductors Despite the challenges in the SoC space in 2011, TV semiconductor market will still have growth opportunities in the next few years, especially TVs are expected to provide more complex functions. This type of functionality will enable each TV to use more semiconductor chips, which is very beneficial to the TV semiconductor industry.

The Smart TV feature is one of these advanced features that will use more chips that provide wireless connectivity and greater network interactivity. The expansion of the network television or smart TV sector will help increase the sales of TV motherboard integrated circuits and will require more DRAM and flash memory.

TV manufacturers are already rapidly launching TVs with Internet connectivity. Even low-end models now offer Net? Built-in applications such as ix or Hulu Plus allow consumers to watch more TV content over the Internet. IHS believes that the use of a dual-core central processing unit (CPU) and quad-core graphics chips will also allow TV and set-top box SoC vendors to move toward more open and programmable solutions.

Other TV features that will benefit the TV semiconductor industry include 3D playback support, 240Hz refresh rate, LED backlight solutions, Bluetooth-based remote control, and gesture and voice recognition. Brazil, China, and the Asia-Pacific region continue to transition from analog to digital television, and it is expected to help the expansion of the TV semiconductor industry in the near future.

The industry consolidation boom in 2011 caused a decline in the SoC sector, leading to the withdrawal of several important manufacturers, but this benefited the Taiwan chip suppliers Morningstar Semiconductor and MediaTek, which almost completely controlled the TV video processor market last year. The two together accounted for more than 56% of the total TV SoC sales, accounting for more than 65% of shipments.

As some suppliers have withdrawn from the TV SoC field, Morningstar Semiconductor and MediaTek will almost certainly maintain their dominant position in this market in the next few years. The companies that have withdrawn from the market include Broadcom, Zoran, and Intel. Intel’s efforts to provide advanced television SoCs for smart TVs have not been successful, and ultimately they have no choice but to withdraw from the competition.

Other M&A activities in the industry last year include: Integrated Device Technology sold the HQV processor product line to Qualcomm; Trident Microsystems sold the set-top box processor business to En during its application for bankruptcy. Tropic Communications Inc. .

In 2011, the performance of the television terminal equipment and semiconductor market was sluggish, forcing the industry to perform such rapid integration. IHS believes that Morningstar Semiconductor and Mediatek have extensively entered the TV semiconductor industry, making it difficult for other manufacturers to establish a foothold in the industry, leading many companies to withdraw.